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Hindustan Zinc has reported 20 per cent lower net profit in the March quarter. The company was hit by lower production and weak metal prices.
The company has announced a final dividend of 90 paise a share. This takes the total dividend for FY'12 to Rs 2.40 a share.
Mined metal production was down three per cent at 223,000 tonnes (231,000 tonnes) in the March quarter. The fall in output was due to a decline in ore grade at Rampura-Agucha mines. Ramping up of capacity utilisation at Sindesar Khurd mine to 80 per cent and higher metal recoveries at other mines helped partially offset lower output impact, it said. Silver production was up 77 per cent at 88 tonnes (50 tonnes).
Production cost (excluding royalty) of zinc was up 17 per cent at Rs 41,693 a tonne. The increase in costs was on account of rise in raw material prices, besides sharp fall in rupee against dollar.
Zinc price on the London Metal Exchange (LME) was down 15 per cent at $2,025 a tonne ($2,393 a tonne), while lead prices fell 20 per cent to $2,093 a tonne ($2,605 a tonne). Silver prices were up two per cent at $32.6 an ounce ($31.9 an ounce).
For the fiscal ended March, Hindustan Zinc revenue was up 14 per cent at Rs 11,405 crore (Rs 10,039 crore). Net profit jumped 13 per cent to Rs 5,526 crore (Rs 4,900 crore).
Mr Agnivesh Agarwal, Chairman, Hindustan Zinc, said that the company will now focus on the next phase of growth driven by exploration. The company has paid over Rs 3,000 crore in terms of taxes, duties and royalties to the exchequer last fiscal, he said.
Sterlite Industries, a promoter group company, has offered Rs 17,000 crore for buying the Government's stake of 49 per cent in Balco and 29.53 per cent in Hindustan Zinc. It is yet to hear back from the Government.
In the financial year 2012, the company added 27.1 mt to its reserves and resources (R&R), prior to depletion of 8.04 mt. It has 332.3 mt of R&R containing 35 mt of zinc-lead and 912 million ounces of silver with over 25 years of mine life.
Though mined metal production this fiscal to be marginally higher, it expects output to drop in the first half. Total integrated silver production is projected to be around 350 tonnes next year.
As of March, the company had cash and cash equivalent of Rs 17,948 crore.
The shares of Hindustan Zinc were up 0.08 per cent at Rs 126 on Friday.
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